Jacob Williams
Thursday 25th February, 2021

Running gag

Running gag

When Pembrokeshire County Council’s chief executive, Ian Westley, unexpectedly left the authority last year he did so with a £95k pay-off secured through a secret deal.

The statutory auditors are now “currently examining the circumstances that led to the departure” of Mr. Westley, as well as “the circumstances surrounding him receiving a payment of £95,000 under the terms of a Settlement Agreement.”

It’s easy to forget how this investigation by Audit Wales has greatly overshadowed an earlier, unconnected twist in this mysterious saga: the still-simmering squabble over whether the council is in breach of its termination obligations to Mr. Westley.

As I noted early on, it’s not crystal clear if the authority’s finance chief, Jon Haswell, or its leader, Cllr. David Simpson – or both – officially approved the secret contract which secured the unexplained departure and £95k pay-off.

What we do know is that Cllr. Simpson is the only one of PCC’s sixty councillors who has seen or been involved in any way with this legal document.

I’ve previously speculated that somewhere in there is a gagging clause which goes beyond preventing each party badmouthing each other, precluding even factual discussion of the circumstances of, or leading up to, the chief’s exit and any discussions or negotiations.

I said as much at the January 28th meeting of the council’s corporate overview and scrutiny committee, where the gagging clause became centre stage.

In response to councillors’ questions there, Cllr. Simpson said that the parties “were both given advice that we could sign this confidentiality agreement – I don’t like the gagging reference, but that’s what it is, I suppose!” and that “these are standard clauses in these documents,” adding: “I was told it was a standard agreement, a standard clause in a standard agreement.”

So what could be the alleged breach of this ‘gagging’ clause?

Well there’s nothing official so far, but based on questions tabled by Cllrs. Jamie Adams and Stephen Joseph at the December council meeting, and the resultant exchanges, we can read between the lines.

They seem to be concerned that the gagging clause was breached by certain discussions at the public October 2nd meeting of PCC’s seven-strong senior staff committee.

The members of this very powerful panel were considering the process of recruiting Mr. Westley’s interim successor.

I’ve gone through the webcast, so you don’t have to, transcribing councillors’ remarks which might be argued to breach the gagging clause.

At the 15:52 mark Cllr. Simpson, the committee’s chairman and independent council leader, calls on Tenby councillor and leader of the Plaid Cymru group, Michael Williams, who says:

“Thank you mister chairman, I’m reasonably happy with an internal appointment for the interim head of paid service, but the priority as far as I’m concerned must be a corporate restructure, which we seem to have been waiting for forever and a day, and I think that’s long overdue.”

Cllr. Simpson then immediately responds that Cllr. Williams’ desire is already met by the draft requirements, quoting that the appointee is expected to “…deliver a corporate restructure. So that is in the foremost of our minds.”

Cllr. Williams replies:

“I see that, chairman, I understand that, and I hope that that’s going to be an absolute priority, but to achieve that restructuring, it’s going to be some task for an interim head of paid service, and I assume that there’ll be a budget implication of seeking advice – professional advice – on getting this structure right. Is that accepted – will there be a budget provision made available?”

Cllr. Simpson – who can be heard saying “yes” during Cllr. Williams’ last line – says:

“I think yes – I think it is certainly accepted, and if it costs us money, we will do it.”

Cllr. Williams:

“That’s good, because we’ve got to get this right, we cannot carry on as we are.”

Later in the meeting, after commenting on other matters that had emerged during the debate, leader of the Labour group and regeneration cabinet member, Cllr. Paul Miller, responds directly to Cllr. Williams’ staff restructure comments, at the 41:38 mark:

“On the corporate restructure, I just wanna agree with everything that Cllr. Williams said at the start. This has been needed for a very long time. We asked the previous chief executive to undertake one immediately following his appointment. That never happened, and that’s continued to be a matter of disappointment for me. We need to ensure that our teams, our structures and our management function is adept and ready and equipped for the next generation of challenges, and it’s very important that we continually review those structures, so I very much welcome that being an output from the interim arrangement.”

It’s understood that Mr. Westley objects most strongly to any suggestion that he failed to conduct a staffing restructure that was expected of him during his tenure.

Seven weeks after this meeting, all councillors were circulated the following rather legalistic piece in an email on behalf of the council’s leader:

I have obtained advice from Eversheds, the legal firm who provided advice to myself in negotiating and agreeing the Settlement Agreement with the Chief Executive. The advice has been provided to offer Members clarity around an important term in the Settlement Agreement that if breached may lead to a claim against that Member and the Council.

The purpose of this email is to bring to your attention the effect of a clause within the Settlement Agreement, that is standard wording for this type of agreement about confidentiality, and also a requirement not to make derogatory comments or disparaging remarks about, in these circumstances, the Chief Executive who is currently exiting from this Council.

The wording of this standard clause says that if derogatory or disparaging statements are made, or actions undertaken which may be construed to damage or lower the reputation of the Chief Executive, or the confidentiality around the facts or circumstances of the settlement agreement, or details of the content of that agreement are disclosed, that may put the Council and individual Members at risk of a legal claim. This can be serious and costly; as well as a claim for breach of contract, a claim for unlawful disclosure of personal data may also be made, which may involve an investigation by the Information Commissioner who has the power to fine the Council and take enforcement action. There is also the reputational damage any claim could cause.

I hope you will appreciate the importance of making sure confidentiality is preserved, and the importance of maintaining the integrity and trust in officer/member relations. Whilst Members generally follow the Code requirements and expectations about confidentiality, this clause is a reminder of just how important that is, and goes hand in hand with the fundamental need for members to treat officers and each other with respect. Authorities work best where everyone treats each other with respect and courtesy, and this advice reiterates my previous messages, and is also to remind all members about how important it is to take care with any comments made which may be regarded as a breach of confidence or cause hurt or upset even if that was not intended.

This was a bit rich even by County Hall’s historic standards – and the bit about ‘reputational damage,’ almost too good to be true!

Councillors had been kept – and remain – completely in the dark about the whole process, and if, as one might assume, it took an extraordinary intervention from the outgoing chief executive to see that we were alerted to the secret agreement’s gagging clause, this was a monumental oversight by the council’s in-house lawyers.

Not just an elementary failure to safeguard councillors, but corporately a failure to protect the council from a potential legal claim.

Coming so many months after the agreement was signed and announced, not even stable doors and bolting horses clichés sum up the sloppy lapse.

It also raises many issues besides – particularly the bit that claims the gagging clause is: “an important term in the Settlement Agreement that if breached may lead to a claim against that Member and the Council.” (My emphasis underlined in bold.)

Whilst it’s possible that a councillor could say or do something which has the effect of making the council – corporately – vulnerable to a legal challenge from Mr. Westley for breach of contract, the reference to individual members and their legal liability in a personal capacity could at least have been worded properly.

I treat it as a baseless threat to us mere backbenchers that, if we make disparaging remarks of the former chief executive, even if provably true, we could be liable, as a private individual, to legal action by Mr. Westley to enforce the secret settlement contract to which we are completely blind.

It raises questions over the ability of elected members to contribute to political debate – freedom of expression which attracts enhanced protection.

In other words, the extent to which councillors – making remarks in a council meeting – could be at fault if they offered facts or honestly-held opinions which could form the opening for costly and protracted civil proceedings against the council, regardless of legal merits.

It might be assumed that, taken alone, the aforementioned comments – which appear to this non-lawyer to be honestly-held views expressed by two councillors in a committee meeting – offer Mr. Westley little prospect of success in suing the council for a breach of the secret agreement.

But if not, who could criticise him for enforcing his contractual expectations?

Conversely, if councillors believed that this £95k exit package was a sweetheart deal worthy of scrutiny, how much would the existence of the gagging clause hinder that pursuit?

Quite a great deal, it would seem – so the Audit Wales investigation has an awful lot riding on it.

More details are emerging – and may still emerge next week…

Following the Christmas full council meeting Cllr. Simpson undertook – at Cllr. Adams’ specific request – to seek an external legal opinion on whether councillors’ comments at the October senior staff committee meeting breached the Westley agreement.

It was duly procured and circulated to us all on behalf of the interim chief executive, Richard Brown, on February 1st.

Unlike the earlier missive – which I quoted above, in full – this communication was prominently emblazoned with “STRICTLY PRIVATE AND CONFIDENTIAL.”

Councillors are warned “that this advice is covered by legal professional privilege, and is being shared in confidence with Members in order respond [sic.] to the questions raised by Cllr Jamie Adams, but also to inform as to what would be the Council’s position if challenged.”

As such, there’s not a great deal I can say on its content without breaching my undertakings as a councillor, but JW notes some revealing members’ questions have been tabled on the just-published agenda for next week’s full council meeting – the first since December.

Cllr. Steve Joseph asks if the circulation of “recent Eversheds advice” to members – which he says includes “the reproduction of the confidentiality clause in paragraph 13.2.3” – constitutes “a breach of the agreement in itself?”

Cllr. Adams probes Cllr. Simpson’s legal authority, as a council leader, to sign-off the £95k departure deal “over such a publicly contentious matter.”

The former council leader says his successor’s failure to put it to the chamber for a debate and vote of all sixty councillors amounts to “circumventing the democratic body” and asks if it “upholds the ‘openness and transparency’ moral mantra that he is fond of quoting?”

Meanwhile, Cllr. Joseph wants Cllr. Miller to confirm that he “had no knowledge that Ian Westley had completed a senior management review report” at the time he made his aforementioned October 2nd meeting comments.

The Milford Haven member, and former town mayor, also asks: “What is the priority of legal services – is it to advise and protect the cabinet or the council as a whole and do they have a legal and moral obligation to ensure that the council acts in a proper manner?”

The first full council meeting of 2021 starts at 10am on Thursday, 4th March, and will be live-streamed and subsequently archived, at this link.

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  • Cllr Paul Dowson

    Do you recall the following promise in 2017?

    This council will be open and honest…

  • Flashbang

    All I can say about Simpson is, who died and made him king?

    What is the point of having all you overpaid councillors if your role is just to be decoration and extras for live streams?

    Start kicking backsides and getting answers about throwing away taxpayers’ money on in-house spats.

  • What I think mustn’t be forgotten is that, if Mr. Westley now regrets that he left – and it seems that he might – then he nonetheless wished to leave when he willingly signed on the dotted line last year.

    As I also said at the January scrutiny committee meeting, one of the many key differences between this chief executive’s pay-off and that of Bryn Parry-Jones in 2014, is that Bryn’s lucrative deal came before full council and was approved by a majority.

    There’s mounting speculation in the council’s virtual members’ tearoom that Audit Wales will come to the view that Mr. Westley’s £95k pay-off should also have come before full council for approval.

    If that had been the case, a majority of councillors may well have approved it – especially since it would have been a case of the chamber being asked to give its blessing to a deal Mr. Westley wanted to proceed.

    For anybody interested in following this affair – especially councillors, for whom the gagging clause makes scrutiny most difficult – the January meeting’s webcast is essential viewing.

    Agenda item 6, from 46:04.

    In fairness to Cllr. Simpson, his input was more frank compared to the exchanges at the December full council meeting – but it seems that the gagging clause really has prevented us from fully understanding what went on.

    Among his comments, Cllr. Simpson said that “…both parties signed this agreement willingly, nobody was forced into it, nobody was cajoled into it – both parties signed it willingly after taking legal advice.”

    On the prospect that it should have gone to full council: “…I was given legal advice that it was within my power, within the constitution, to take that step. I was given that advice by officers.”

    On his hands now being tied by the gagging clause: “…if I’m party to a confidentiality agreement – which is a standard procedure – then I cannot talk about it, and I apologise for that, but I cannot talk about it.”

  • John Hudson

    There has always been some ambiguity in the ability of a council’s in-house legal officers to troll off to obtain external legal advice to defend or protect councils from legal challenge.

    One may have the perception that such advice is sought for the purpose of allowing the council to pursue or support a favoured particular course of action, rather than seek an impartial legal view.

    Such advice inevitably incurs additional expenditure, which has not been specifically provided for in the annual revenue estimates approved by the council. The cost has to be found somewhere.

    I am not sure that any officer has the power to incur expenditure not provided for in the annual budgets as provided for in departmental budgets as approved by the full council.

    Makes a bit of a mockery, when budget reductions are approved in respect of legal service and monitoring officer budgets, which are recharged to specific front line service or departmental budgets.

  • Malcolm Calver

    Cllr Simpson has over the last twelve months tried to ingratiate himself to the Pembrokeshire electors with his prowess regarding the coronavirus crisis.

    He might be the appointed council leader, maybe for only a little longer, but he has not as far as I am aware been appointed supreme leader or for that matter king.

    No matter what Eversheds say it cannot be right that elected councillors on behalf of their electorate should be denied all information on what has been described as a voluntary agreement between Mr Westley and the body known as “Pembrokeshire County Council.”

    The time has come for Cllr Simpson to consider his position and stand down as surely councillors must realise they have and are being deliberately being kept out of the information loop.

  • John Hudson

    I see from the the rather obscure report to the Governance and Audit Committee, item 13 (pages 153-154) available in the full reports package, that the Audit Wales team have been “unable to locate a recorded decision to enter into the settlement agreement which led to a termination payment being made to the Chief Executive.”

    Audit Wales have had to take some external legal advice. I thought that the council had some of this already. Have we got to pay for this twice?

  • Faux Espoir

    The audit report once again shakes the bars of the officers encamped at the Kremlin.

    It would be interesting to know who was present at the ‘unrecorded decision’ – just officers who presented to the leader or were councillors involved.

    Who put the notion of the pay off to the CEO Ian Wesley, but more importantly why? What has caused the decision making process to be initiated?

    Pembrokeshire has lost a senior officer in this process. If the Audit Wales report highlights deficiencies in the direction of travel, those officers, including the legal department need to be held accountable.

    Cue another quick raft of ‘pensioned off’ like happened in the Mik Smith fallout and the saga related to the Pembroke Dock grants scandal. #LocalGovernmentgravytrain

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